The differentially methylated domain (DMD) of the mouse H19 gene is a methylation-sensitive insulator that blocks access of the Igf2 gene to shared enhancers on the maternal allele and inactivates H19 expression on the methylated paternal allele. By analyzing H19 DMD deletion alleles H19DeltaDMD and H19Delta3.8kb-5'H19 in pre- and postimplantation embryos, we show that the DMD exhibits positive transcriptional activity and is required for H19 expression in blastocysts and full activation of H19 during subsequent development. We also show that the DMD is required to establish Igf2 imprinting by blocking access to shared enhancers when Igf2 monoallelic expression is initiated in postimplantation embryos and that the single remaining CTCF site of the H19DeltaDMD allele is unable to provide this function. Furthermore, our data demonstrate that sequence outside of the DMD can attract some paternal-allele-specific CpG methylation 5' of H19 in preimplantation embryos, although this methylation is not maintained during postimplantation in the absence of the DMD. Finally, we report a conditional allele floxing the 1.6-kb sequence deleted from the H19DeltaDMD allele and demonstrate that the DMD is required to maintain repression of the maternal Igf2 allele and the full activity of the paternal Igf2 allele in neonatal liver.